The sovereign debt crisis in Cyprus marks the fifth European nation to need a bailout in recent memory, but this crisis is unique because European Union regulators are taking the unprecedented step of taxing bank deposits to finance part of the bailout for the nation’s banks. Lee Buchheit, sovereign debt guru and architect of Greece’s bailouts, tells Bloomberg Law’s Lee Pacchia that despite the drastic measures taken, the endgame for Cyprus might be another round of restructuring: “I’m not sure this is over…They have certainly changed the rules of the game for future Eurozone bailouts…The situation is spiraling down…they’ll need more money because the economy is worse, tax collections less, deposits will flow out when they can flow out.”
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